* SPDR Gold holdings fell 0.4 percent on Friday
* Speculators trim net shorts in COMEX gold
* GRAPHIC-2018 asset returns: (Updates with U.S. trading, settlement prices)By Zandi Shabalala and Jessica Resnick-AultLONDON/NEW YORK, Sept 3 (Reuters) - Gold prices easedslightly on Monday as the dollar held near a one-week high onworries over an escalation in trade conflicts between the UnitedStates and other countries.A firmer U.S. currency makes dollar-priced gold moreexpensive for holders of other currencies, potentially sappingconsumption. Safe-haven demand for gold has this year beenovershadowed by the metal's relationship with the greenback.U.S. President Donald Trump said on Saturday that there wasno need to keep Canada in the North American Free TradeAgreement and warned Congress not to meddle with negotiations orhe would terminate the trilateral pact, which also includesMexico. Meanwhile, Bloomberg News reported that Trump was preparedto ramp up a trade war with China and had told aides he wasready to impose tariffs on $200 billion more in Chinese importsas soon as a public comment period on the plan ends on Thursday. "As long as the trade war fears that are helping dollarstrength continue, gold is going to come under pressure," saidETF Securities commodity strategist Nitesh Shah.Walter Pehowich, executive vice president of investmentservices at Dillon Gage Metals said "if tensions in the emergingmarkets settle down, gold could be very volatile."
Gold prices are down about 8 percent this year against abackdrop of rising U.S. interest rates, trade disputes and theTurkish currency crisis, with investors parking their money inthe dollar.Spot gold was down 0.03 percent at $1,200.4 an ounceby 1:09 p.m. EDT [17:09 GMT].
The most active U.S. gold futures for Decemberdelivery rose $0.30, or 0.02 percent, to $1,207.00 per ounce.
The dollar index , which measures the greenbackagainst a basket of currencies, was barely changed at 95.12. If gold recovers to $1,210 there is a good chance of furtherrebounds to $1,230, said ActivTrades chief analyst Carlo AlbertoDe Casa. But a decline below $1,200 would see prices test $1,180and the following support placed at $1,160, he added.
There was some indication that the bearish sentiment in themarket has started to shift slightly, with net short positionsin COMEX gold contracts in the week to Aug. 28 showing a declinefor the first time in more than a month. U.S. economic data this week, including a manufacturingsurvey on Tuesday and an employment report on Friday, couldinfluence gold's moves as investors look for clues on the paceof U.S. interest rate increases.Meanwhile, liquidations continued in SPDR Gold, the world'slargest gold-backed exchange-traded fund. Holdings have fallenby more than 13 percent since peaking in late April. Spot silver was down slightly at $14.46 an ounceafter touching its lowest in more than two weeks at $14.37.
Platinum rose 0.1 percent to $783.50 an ounce, whilepalladium fell 0.1 percent to $979.5 after hitting a10-week high on Friday at $984.97.
(Reporting by Zandi Shabalala and Jessica Resinick-Ault;Additional reporting by Nallur Sethuraman in BENGALURUEditing by Kirsten Donovan, Dale Hudson and Andrea Ricci)